In a recent development, the fast-food chain of US McDonald’s has decided to temporarily shut down its 165 quick service restaurants in north and east India. The food outlet has announced a settlement with its Indian partner Vikram Bakshi putting end to almost six years of the legal battle.
The US-based food chain has bought 50 percent stake in Connaught Plaza Restaurants Pvt Ltd that runs and operates McDonald’s outlet in the north and east India as a part of the deal.
However, the company did not disclose the details of the financial transaction but as per the buzz in the market, the deal was locked at around Rs 1,200 crore.
McDonald’s and Vikram Bakshi told a two-member National Company Law Appellate Tribunal (NCLAT) bench that is headed by SJ Mukhopadhyay on Monday that they were working to settle the matter out of the court.
Reportedly, Vikram Bakshi is in talks with rival burger chain of McDonald’s, Wendy’s for the franchise rights. The reports in a national daily also quote the tycoon saying “I have yet to take any decision about the future.”
Food chain Wendy’s runs over 6,600 restaurants globally. Presently it operates less than 10 QSRs in India and has postponed plans of opening up to 50 outlets. The report by national daily further states that if Bakshi forms a partnership with Wendy’s when he will bring his experience and help the food chain strengthen its position in Asia’s third-largest economy.
McDonald’s said in a statement “Existing managers and crew will continue to be employed during this temporary closure and will be actively involved in activities to re-open the restaurants.”
Robert Hunghanfoo, who has been appointed the head of CPRL after Bakshi’s departure, told the daily that “Our top priority is to deliver the highest quality restaurant experience to our customers. We will be working around the clock during this process and anticipate our restaurants will start to progressively open over the next two weeks or so. While we are confident this will result in the best possible experience for our customers, we sincerely regret any inconvenience the temporary restaurant closures may cause.”
For those unaware, in 2013, McDonald’s and Vikram Bakshi’s relationship went sour and the latter was removed as the managing director of the joint venture giving rise to a legal tussle. He challenged his removal alleging McDonald’s mismanagement and unjust treatment.
In 1995, McDonald’s has marked 25-year partnership agreement with Vikram Bakshi to open its outlet in India in the North and East.